Important Draft Laws. Issue 47: International Tribunal for Russia, Defence City Benefits, and Changes to Government Appointment Proced

Ratification of the agreement to establish an international tribunal for investigating the crime of aggression against Ukraine

The Verkhovna Rada proposes ratifying the Agreement (Bill No. 0328) that envisions the creation of a Special Tribunal together with the Council of Europe. The tribunal would handle cases against top officials of states involved in the aggression against Ukraine—leaders of Russia, Belarus, or other countries that supported the invasion. The tribunal would have international status—its rulings would be recognized beyond Ukraine’s borders. The main goal is to hold those who decided to go to war accountable.

A separate tribunal is needed because the International Criminal Court (ICC) cannot prosecute the crime of aggression if the country in question—such as Russia—has not ratified the Rome Statute. In addition, Russia does not recognize the ICC’s jurisdiction, and Russia’s veto power blocks the mechanism for launching cases through the UN Security Council. The ICC is instead investigating crimes against humanity and war crimes, and in 2023, it issued arrest warrants for Putin and Lvova-Belova over the deportation of Ukrainian children. At the same time, Ukrainian courts have issued absentia verdicts against certain Russian officials, including State Duma speaker Volodin. However, enforcing these rulings is limited—Ukrainian court decisions are not recognized internationally and cannot overcome personal immunities (a global rule prohibiting the prosecution of sitting heads of state in foreign courts, established by a ruling of the International Court of Justice).

The international tribunal is needed precisely to fill this gap. It would provide a legal mechanism for prosecuting those who decided to start the war against Ukraine, with guarantees that its rulings would be recognized beyond our country’s borders.

According to the agreement, the tribunal would be based in The Hague (Netherlands). Its statute outlines the procedures for investigation, trial, and appeals, and the qualifications for judges, prosecutors, and defense attorneys. The tribunal would consist of three chambers: a pre-trial chamber (one judge), a trial chamber (three judges), and an appeals chamber (five judges). All judges would be representatives of different countries. They would be appointed by a Governing Committee—an institution created within the Council of Europe, responsible for the tribunal’s administrative management, funding, policy, and staffing decisions. The list of candidates from which the Committee would select judges would be prepared by an independent group of respected legal experts. The judges themselves would elect the president of the Tribunal for a three-year term. He will direct its work, including presiding over the appeals chamber, allocating cases, and making procedural decisions.

Defence City: support for the defense industry

Bill No. 13420 proposes introducing a range of tax benefits for enterprises included in the List of Defense Industry Enterprises, which would be approved by the Ministry of Defence, until January 1, 2036.

A company would be eligible for inclusion in the list under the following conditions: it receives at least 90% of its income from defense-related activities; it is registered in designated territories (regions) determined by the Ministry of Defence—such as areas prioritized for the defense industry or relocation; it has no ties to the aggressor state, no tax debt, and is not a nonprofit. Once added to the list, the company would gain the status of a Defence City resident. These enterprises would not pay corporate income tax, land tax, real estate tax, or environmental tax, provided their profits are used exclusively for law-defined purposes (including production development, modernization, support for defense forces, etc.).

An enterprise on the list would be required to submit quarterly reports to the Ministry of Defence detailing its performance: the volume of products manufactured, income levels and sources (including confirmation that at least 90% of income comes from defense production), fulfillment of contractual obligations, and so on. If a company violates these requirements, it would be removed from the list and required to repay the value of the benefits received, along with fines and penalties.

If an enterprise is not registered in a territory designated by the Ministry of Defence, it must submit a relocation request and its application for inclusion in the List. Relocation refers to the transfer of production to a new territorial community specified by the Ministry, along with a change of legal address. The enterprise must complete the move to the new community by December 31, 2028, or it will be excluded from the list.

The bill also proposes allowing the enterprises from the List to export military technologies under international agreements if those enterprises have 100% control over a foreign legal entity (that is, if the Ukrainian company owns a foreign company registered in a country with which an interagency international agreement involving the Ministry of Defense has been signed). Such exports would be permitted only after receiving authorization from the State Service for Export Control, which would issue approvals through a simplified procedure to be established by the Cabinet of Ministers.

Bill No. 13421 proposes temporarily changing the customs clearance rules for defense industry enterprises. Imports (for final consumption), temporary imports (with required future re-export), processing on the customs territory (with subsequent export of the processed goods), or processing outside the customs territory (with return of the finished goods) would be allowed under a simplified procedure—without meeting certain authorization, documentation, or inspection requirements. These changes would apply during martial law and one year after it ends. The new rules would apply to companies from the List of Defense Industry Enterprises and the Armed Forces, the Ministry of Defense, other military formations, and law enforcement agencies involved in national defense.

Bill No. 13422 and the alternative bill, No. 13422-1, propose that, in 2026–2028, 50% of personal income tax paid by defense industry enterprises that have applied for relocation would be directed not to the general fund, but to a special fund of the local budget of the community receiving these enterprises. The funds received must be used for infrastructure development and to support the relocation directly.

In addition, both bills include exceptions related to intergovernmental fiscal transfers, but in different ways. Bill No. 13422 stipulates that communities receiving relocated enterprises would temporarily be exempt from transferring reverse grants to the state budget—that is, the community would not have to contribute part of its revenue to the national budget, even if its financial indicators are above average. The alternative bill, by contrast, proposes that 50% of the personal income tax paid by defense enterprises not be factored into calculating a community’s fiscal capacity for horizontal equalization (i.e., the redistribution of funds from wealthier communities to less affluent ones).

Special procedure for criminal liability of defense industry enterprises

Bill No. 13423 proposes that actions or inaction by managers of enterprises included in the Ministry of Defence’s List (Defense City participants), carried out in the course of business activities (such as procurement), and exhibiting signs of a crime, not be classified as criminal offenses if they were necessary to fulfill a defense contract during martial law and did not pose a threat to human life or the environment. While a company remains on the Ministry’s List, criminal penalties would not apply, even if the grounds for prosecution arose before its inclusion. After being added to the list, an enterprise could appeal to the Prosecutor General for a review or cancellation of previously imposed measures. Once removed from the list, criminal proceedings would resume under the standard procedure.

The Criminal Procedure Code would introduce a new process for investigating crimes related to such enterprises. Information about potential offenses could be entered into the Unified Register only by the Prosecutor General or someone acting on their behalf. Any investigative actions would require the Prosecutor General’s approval.

Tax and customs benefits for investors in the processing industry and a new mechanism for state support

Bill No. 13415 proposes a new system of tax incentives for investments in the processing industry. The Ministry of Economy would create a Register of Investors in the Processing Industry (covering production in the food, light, chemical, machine-building, electronics, furniture, and transport sectors, excluding excise goods, including cars, motorcycles, buses, and trucks). To be included in the Register, a Ukrainian enterprise must apply with a business plan specifying the planned investment amount (from EUR 100,000 to EUR 50 million) and prove its financial capability (the government would define the documents required for confirmation). The total amount of tax and customs benefits that may be granted to an investor is capped: it cannot exceed 70% of the actual investment for projects from EUR 100,000 to EUR 1 million, 50% for projects of EUR 1–20 million, and 30% for projects of EUR 20–50 million. The investment project must be implemented within no more than three years. The Ministry of Economy would monitor the investor’s compliance with its obligations. An enterprise would be removed from the Register for violating project conditions, submitting false information, or failing to report for two quarters. Suppose the investor fails to meet its obligations. In that case, it must repay the taxes that were not paid due to the benefits, along with a penalty interest (under the Tax Code, the penalty rate is 120% of the NBU’s discount rate—currently 18.6% annually, or approximately 0.0509% of the outstanding amount for each day of delay).

Enterprises included in the register would gain the right to benefits—exemption from corporate income tax for up to 10 years (the Ministry of Economy would determine the specific term for each project) and exemption from value-added tax on importing new equipment. However, only enterprises that generate at least 90% of their income from their production in the processing industry would be eligible for these benefits. In addition, local authorities may independently set a lower land tax rate for such enterprises than the standard rate in the community (for most land plots, the rate ranges from 0.3% to 5%, and in some cases up to 12% of the land’s normative monetary valuation), or exempt them from land tax altogether. This rule is currently in place for companies participating in industrial parks.

Bill No. 13414 aligns the provisions of the Customs Code with those of Bill 13415. It proposes exempting, until 2036, new equipment and components imported by an investor to implement an approved business plan from import duties. The equipment must have been manufactured no earlier than three years before importation, and the investor must retain ownership of the imported equipment for at least five years.

To implement the bill’s provisions, an automatic information exchange is planned between the tax service, customs, and the Ministry of Economy. None of the benefits would apply to goods from the aggressor state or temporarily occupied territories.

Regulation of energy infrastructure projects of public importance

Bill No. 13450 proposes establishing a new legal framework for projects to enhance Ukraine’s energy security, ensure a reliable energy supply, develop energy infrastructure, and integrate it with the EU energy space. This would include Projects of Common Interest of the Energy Community (projects involving Ukraine and other Energy Community contracting parties, included in the official list approved by the Energy Community Ministerial Council), as well as Projects of Mutual Interest with EU member states (projects between Ukraine and EU countries, approved by the relevant EU legal act).

The Ministry of Energy would select projects of public importance, and the Cabinet of Ministers would approve the list. The government would also establish clear criteria for identifying such projects. If a project is included in the list and the investment program (or development plans) of a company operating a power grid, gas pipeline, or other energy facility, it would receive priority in securing funding. This would not automatically guarantee financing from the state budget, but it would facilitate access to international assistance or state support based on a government decision.

New procedures for appointing and dismissing government officials and stricter reporting requirements for the Cabinet of Ministers

Currently, the coalition of parliamentary factions that nominates a candidate for the position of Prime Minister of Ukraine submits this proposal through an MP designated in the coalition agreement. Bill No. 13407 requires that this nomination be signed by all MPs belonging to the coalition. The same requirement would apply to nominations for ministerial positions—with mandatory inclusion of the coalition’s roll-call vote results. This means the parliamentary majority must formally document agreement on each nominee before submitting their names to Parliament. The bill does not specify what would happen if not all coalition MPs sign the submission.

The documents a candidate for Prime Minister or minister would need to submit include a cover letter explaining their vision for the position. In addition, the Prime Minister would be required to submit a draft of the Government Action Program while nominating candidates for ministerial positions. The program must align with the coalition agreement and outline the new government’s goals and tasks.

The draft law also adds a new basis for considering the dismissal of the Prosecutor General—MPs would be allowed to evaluate the Prosecutor’s performance annually (currently, they only review the annual report). If, for two consecutive years, the Rada deems the Prosecutor’s work unsatisfactory, this would automatically trigger a review of a no-confidence motion. Currently, lawmakers can express no confidence in the Prosecutor General—resulting in dismissal—based on a motion submitted by 150 MPs.

The bill also seeks to remove the Cabinet of Ministers of Ukraine from the list of bodies whose powers cannot be terminated during martial law. Despite this, on July 17, 2025, the Verkhovna Rada approved a new composition of the Cabinet of Ministers without adopting this bill. As a result, the government was reshuffled in violation of the current Law on the Legal Regime of Martial Law provision, which prohibits terminating the government’s powers while martial law is in effect.

New procedure for property valuation

Bill No. 13435 proposes a new version of the Law on Property Valuation, introducing a distinction between two types of valuation: independent valuation (conducted by a certified appraiser) and standardized valuation (carried out by state authorities). The bill also specifies that valuations may be performed to determine various types of value: market, fair, special, investment, or assessed. This differentiation between valuation types and value represents a new approach, as the current law does not contain such a classification.

The bill seeks to introduce international (IVS) and European (EVS) valuation standards into Ukrainian legislation. These standards would directly affect Ukraine and define the methodology for valuation, report preparation, and reviews, regardless of the value being assessed. In the event of discrepancies between the standards, European standards would take precedence. While the law would not guarantee automatic recognition of Ukrainian valuation reports abroad, applying such standards would make them clear and acceptable to international users.

The new law also establishes a single self-regulatory organization of appraisers, which would have legal status. Its primary purpose would be to represent appraisers’ interests in interactions with the state, organize professional training and continuing education, oversee the quality of appraisal activities, participate in the qualification and disciplinary commission, and review valuation reports in specific cases. Under the bill, an appraiser would become a member of the self-regulatory organization from the date their information is entered into the Unified Register of Appraisers of Ukraine. The State Property Fund of Ukraine would serve as the holder and administrator of the Unified Register. Unlike the current system, in which several professional associations of appraisers operate, the new law would establish a single organization responsible for centrally carrying out all professional and regulatory functions within its defined mandate.

In addition, the bill proposes allowing a land plot and the buildings on it to be appraised as a single object of disposal. Instead of conducting separate valuations of the land and the real estate (as is currently the case), the appraiser would prepare one report, with the value of each component listed separately.

The new version of the law would retain the requirement to prepare a property valuation report but introduce a new condition: such a report must be registered in the electronic state register to be considered valid. For the first time, the law would separately regulate the valuation of damage—specifically, the damage, destruction, or loss of property—caused by war. Independent appraisers or government authorities could carry out this type of valuation. These issues are not regulated under the current law.

A separate section is dedicated to the qualification of appraisers. As is currently the case, to become an appraiser one must have higher education, complete at least one year of training under a specialized program at a higher education institution that has a cooperation agreement with the self-regulatory organization of appraisers or the State Property Fund of Ukraine, and pass an exam (which includes theory, practice, and defense of the reports prepared during training). Individuals who completed training and internships before adopting the new law, or received their training abroad, may take the exam without undergoing the basic qualification program. An appraiser would receive a permanent qualification certificate based on the exam results. Currently, the certificate can be renewed every two years without reexamination; however, if the candidate applies for renewal more than two years after expiration, they must retake the exam. The bill provides that appraisers must now undergo continuing education every three years (instead of every two). To meet this requirement, they may complete a training course and pass a specialized test—or, under a new option, have their valuation reports reviewed.

The bill also states that appraisers with a valid certificate in expert monetary valuation of land would automatically qualify as real estate appraisers without additional training or examination.

Amendments to tax and budget legislation to support mountain areas

Bill No. 13403 aims to amend the taxation rules for forest lands to boost local budget revenues in mountain communities. Currently, the tax rate for forest lands is 0.1% of the normative monetary valuation (NMV). The bill proposes raising this rate to between 0.3% and 0.5% of the NMV.

Bill No. 13404 proposes exempting medical facilities in mountainous areas from the minimum service volume requirement needed to qualify for state budget funding—meaning these facilities would receive funding regardless of how many services they provide. It also introduces a ban on closing such facilities, including maternity wards, unless the local community initiates the decision through public hearings.

Bill No. 13451 would revise the procedure for distributing rent payments for the use of forest resources. Currently, 37% of such payments are allocated to local budgets, with the remainder going to the state budget. The bill proposes that 100% of the rent from timber harvested during main-use logging (a type of logging that targets mature or overmature trees for wood. It accounts for 38% of total logging, with the rest aimed at forest formation and health improvement) be directed to local budgets. This change would enable communities to receive more revenue directly from using local natural resources.

New guarantees for participants in criminal investigations and trials

Bill No. 13430 would amend the rules under which investigators, inquiry officers, or prosecutors may enter a person’s home or other property without the authorization of an investigating judge. Currently, the Criminal Procedure Code permits this only in urgent cases—when it is necessary to save life or property, or when law enforcement officers are pursuing a suspect immediately after a crime. In such situations, if police officers enter a person’s home or other premises, they must promptly (according to judicial practice—within 24 hours) apply to an investigating judge for authorization to search. If the premises owner believes the entry or search was conducted without legal grounds, they may file a complaint with the court. The court is required to consider the complaint on the same day.

The court checks whether there were lawful grounds for entering the premises without a warrant. If the prosecutor refuses to approve the application or the court denies the search warrant, the collected evidence is considered inadmissible, and all information obtained must be destroyed. The bill seeks to clarify the time limit for such entry: it would allow law enforcement to enter premises without a warrant within 48 hours of the crime. At the same time, the bill proposes to prohibit searching for these situations until a judge issues a warrant; only entry into the premises would be permitted. All other actions, including searches, must wait for court authorization.

Clarifying the right of attorneys to record procedural actions on video

Bill No. 13400 seeks to clarify provisions in the law on legal practice that grant attorneys the right to copy case materials and record procedural actions and court hearings. The law does not specify which devices an attorney may use for this purpose.

The bill clarifies that an attorney would have the right to do so using a portable video recorder or a personal mobile phone. This addition would help prevent restrictions or misunderstandings during court proceedings.

Guarantees for service members with children

Bill No. 13436 proposes that pregnant service members be assigned to duty shifts or involved in combat missions only with their consent and based on the recommendation of the head of the medical service. If performing military duties poses a health risk, the commander must transfer the woman to another unit where safe conditions can be ensured.

The bill also states that servicewomen with children under the age of three and service members who are raising a child under the age of 14 on their own may be assigned to shifts, deployments, or combat missions only with their consent. The same rule applies to one parent in families where both are in military service if the other parent is already serving away from the child’s place of permanent residence. In addition, assignment to a new position or transfer to another location for these categories of military members would also require their consent.

Changes to administrative liability for causing children to become intoxicated

Currently, the Code of Ukraine on Administrative Offenses establishes liability for causing a minor (aged 14 to 18) to become intoxicated. However, it does not explicitly mention younger children (under 14). Lawmakers seek to correct this (Bill No. 13438). Similarly, the draft law proposes holding parents or guardians accountable for crimes committed by children under 14 (at present, such liability applies only to crimes committed by children aged 14 to 16).

Fines for broken toilets and air conditioners in buses

Bill No. 13396 proposes requiring passenger carriers to check the functionality of on-board toilets—if included in the bus design—and air conditioning systems before each trip. If a bus operates with a broken toilet or passenger access is restricted (when the toilet is part of the bus’s construction), the driver would face a penalty of UAH 8,500, and company managers and carriers could be fined UAH 17,000. Operating a bus with a faulty air conditioning system would result in a fine of UAH 1,700 for the driver and UAH 3,400 for the company.

In cases of repeated violations within a year—or if a malfunction leads to a trip being canceled or delayed—the penalties increase: the driver would be fined UAH 17,000, and the carrier would face a UAH 34,000 fine and a one-year suspension of its passenger transport license.